Capital One and Discover have been working towards their merger, which is expected to be finalized on May 18. The deal has generated concerns about reduced competition and potential harm to low-income consumers, but experts say it could lead to an improved experience for customers.
Under the new combined bank, Capital One account holders may get access to cashback debit cards and other rewards. Discover’s debit card offers 1% cashback on up to $3,000 in purchases a month, making it one of the few debit cards that still offers rewards after the Durbin amendment to the Dodd-Frank Act placed a cap on interchange fees.
Experts say Capital One will likely shift its debit cards to Discover’s payment network, lifting caps on swipe fees and generating extra revenue. This could lead to an opportunity for Capital One customers to get access to rewards debit cards. Kaiji Chen, a professor of economics at Emory University, agrees that rewards debit cards will probably be offered soon.
Discover account holders will gain access to more than 250 bank branches and more than 50 cafes, which is a considerable upgrade. They will also have access to more ATMs nationwide, although there may be some overlap with Capital One’s current network of fee-free ATMs.
The merger has sparked concerns about the impact on lower-income consumers and those with lower credit scores. However, experts suggest that Capital One might offer more banking features that could encourage underbanked consumers to open fee-free checking accounts.
Sign-up bonuses for new bank accounts are also possible, especially if you’re looking to switch banks. The combined bank may advertise sign-up bonuses to entice new customers.
As the merger progresses, account holders should keep an eye on international acceptance of debit cards, notices of conversions or necessary actions, and exposure to subprime borrowers. Capital One officials have stated that there will be no immediate changes to customer accounts at either bank, but customers will be notified well in advance of any conversions or other changes.
Key benefits for customers include:
* Access to cashback debit cards
* More banking features that could encourage underbanked consumers to open fee-free checking accounts
* Potential sign-up bonuses for new bank accounts
* Improved experience through increased branch and ATM availability
However, concerns remain about the impact on low-income consumers and those with lower credit scores. It is essential to monitor these areas closely as the merger progresses.
Source: https://www.usnews.com/banking/articles/what-the-capital-one-discover-merger-means-for-your-bank-account